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Mixed-use construction bill nears final vote

Juneau delegates back AHFC funding for commercial, residential development

Only the governor’s signature lies ahead for a bill that would allow the Alaska Housing Finance Corporation to finance mixed commercial and residential developments statewide.

Rep. Mia Costello R-Anchorage introduced House Bill 50 during pre-files on Jan. 11. House Rules Committee referred the bill to House Labor and Commerce Committee and House Finance Committee. It passed the House on March 20 without objection.

Senate Rule Committee referred HB50 to Senate Labor and Commerce and Senate Finance Committees. Senate Finance Committee members moved the bill out of committee for the final time Friday. It passed Senate vote Saturday and only awaits the Governor’s approval.

”House Bill 50 … is based on good community planning and would be an additional revenue source for AHFC, which would allow the corporation to expand its ability to help ease Alaska’s housing shortage,” Rep. Mia Costello said in her sponsor statement. “Developers have also stated this change will enhance their ability to build AHFC housing units.”

The bill would not allow establishments that involve charitable gaming or adult entertainment to be permitted under this bill, and only an establishment selling alcohol that has been designated as a restaurant by the Alcohol Beverage Control Board could be permitted, as opposed to bars.

“In other words, this bill is intended to exclude businesses that are not children and family friendly,” Costello said in her statement.

Juneau Reps. Beth Kerttula and Cathy Muñoz have added their names to the sponsors list for HB 50. Juneau Sen. Dennis Egan supports the bill as well. Though the bill did not pass through his committees, Egan had the chance to vote on the bill when it hit the Senate floor.

Jesse Kiehl, staff to Sen. Egan and City and Borough of Juneau Assembly Member, said Juneau has not seen much financing from AHFC in a while.

“A lot of housing development is no longer about building housing,” Kiehl said. “It is now a multi–part development.”

Currently, to incorporate commercial space into a community housing project, AHFC must keep housing and business separate. This complicates contracts and leases with legal fees adding to the overall cost.

“They have to decide who pays what portion of the boiler,” Kiehl said. “This bill says ‘no you don’t have to do that.’”

Rep. Cathy Muñoz said she co-sponsored HB 50 at the request of Juneau’s Saint Vincent de Paul General Manager Dan Austin. Austin told her the bill could help his non-profit build better housing for seniors and low-income residents, she said.

Commercial space within a residential building help pay a building’s construction cost, Muñoz said.

“Having commercial uses within a multi-unit housing project can help generate revenues,” Muñoz said. “It also would make a housing project and a neighborhood more attractive by allowing shops, restaurants or child care centers to be part of a unit.”

Austin has championed the Home Run affordable housing project for Saint Vincent de Paul. The project aims to provide handicapped-accessible housing to seniors. The 270-foot units would cost tenants about $500 per month.

Part of what makes the units affordable for seniors on Social Security is the incorporation of a convenience store for the residents and a thrift store on the bottom level.

In a letter to the Affordable Housing Commission, Austin said the project would deliver housing “at a price low-income seniors can afford without subsidies.”

Saint Vincent de Paul has asked for funding through the Alaska Housing Finance Corporation and through a CBJ matching grant.